Connecting for Positive Change _ ktn-uk.org/Global
Global Expert Mission South Korea Smart Cities 2019
Contact Dr Nee-Joo Teh Head of International and Development [email protected]
Aline Martins Knowledge Transfer Manager – International & Development [email protected]
SOUTH KOREA SMART CITIES 2019
Contents
Welcome 4
1. Introduction 5
2. Korea Market Landscape 6 2.1 Overview 7 2.2 Policy: The Fourth Industrial Revolution (4IR) 7 2.3 Infrastructure: Fourth Industrial Revolution (4IR) 7 2.4 5G: Global Leader 7 2.5 IoT Networks: Global Leader 9 2.6 SME-Enterprise and Innovation 9
3. Korea Smart Cities 10 3.1 National Smart Cities Strategy 10 3.1.1 Projects and Timelines 10 3.1.2 Key Services of National Pilot Projects 10 3.1.3 Regulations and Vendor Selection 11 3.2 Case Studies 11 3.2.1 New Smart City: Busan 11 3.2.2 New Smart City: Sejong 12 3.2.3 Existing Smart City: Seoul 13 3.2.4 R&D Validation in Daegu and Siheung 14 3.3 Barriers to Implementation 15
4. Synergies 16 4.1 Collaboration Synergy 16 4.1.1 Industrial Innovation and Enterprise 16 4.1.2 Innovation Ecosystems 16
5. Potential Areas for Collaboration 18 5.1 Sector Opportunities 18 5.2 City-Based Innovation Ecosystems 19
South Korea Smart Cities 2019 | 3 INNOVATE UK GLOBAL EXPERT MISSION
Welcome
Innovate UK global missions programme is one of its most important tools to support the UK’s Industrial Strategy’s ambition for the UK to be the international partner of choice for science and innovation. Global collaborations are crucial in meeting the Industrial Strategy’s Grand Challenges and will be further supported by the launch of a new International Research and Innovation Strategy.
Innovate UK’s Global Expert Missions, led by Innovate UK’s Knowledge Transfer Network, play an important role in building strategic partnerships, providing deep insight into the opportunities for UK innovation and shaping future programmes.
The Smart Cities Expert Mission travelled to South Korea in June 2019. The findings and insights gathered during the delegation’s time are shared in this report.
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1. Introduction
Ranked first in the Bloomberg Innovation Index1 globally for six years in a row, the Republic of South Korea (Korea) is regarded as one of the most competitive economies globally. Confirming this status, the World Economic Forum (WEF)2 has ranked Korea fifteenth overall for global competitiveness. Korea leads the ICT adoption pillar, boasting some of the world’s highest penetration rates of ICTs, and it ranks eighth on the innovation pillar. Notably, Korea ranks first in the world for research and development (R&D) investment as a percentage of gross domestic product (GDP) with an equivalent of 4.55%.3
Despite these clear strengths, Korea faces a number of challenges to sustain its economic growth and social wellbeing. In response, Korea intends to diversify its national portfolio to include a clear focus on developing advanced ICT technologies and services with a number of Smart Cities initiatives serving as demonstrators. In this evolving context, the Expert Mission was undertaken to identify and develop opportunities for the UK.
The mission was comprised of representatives from the following organisations: • Bodvoc Ltd/University of Warwick • City of Bristol • Data Performance Consultancy Ltd • Design 4 Social Change Ltd • Knowledge Transfer Network • Ordnance Survey Ltd • Places for People Ltd • UKRI - Innovate UK
The mission took place between 8 and 14 June 2019 and included engagement with the following stakeholder groups:
Central Government City Government Industry
• The British Embassy in Seoul • Seoul Metropolitan Government • Hyundai Future Technology Strategy • Presidential Committee for the • Busan Smart City Project Team Team Fourth Industrial Revolution (PC4IR) • Busan Centre for Creative Economy • Intralink Korea and Sub-Committee on Smart Cities and Innovation • K-Water • Ministry of Land, Infrastructure and • Busan IT Industry Promotion Agency • SparkLabs Korea Transport (MOLIT) • Sejong Smart City Project Team • Korea Agency for Infrastructure Technology Advancement (KAIA)
1 https://www.bloomberg.com/news/articles/2019-01-22/germany-nearly-catches-korea-as-innovation-champ-u-s-rebounds. 2 https://www.weforum.org/reports/the-global-competitveness-report-2018. 3 OECD (2018). Available at: https://data.oecd.org/rd/gross-domestic-spending-on-r-d.htm.
South Korea Smart Cities 2019 | 5 INNOVATE UK GLOBAL EXPERT MISSION
2. Korea Market Landscape
2.1 Overview wellbeing. These include domestic slow-down in China, the Korea (estimated population: 51,336,550) is one of the world’s second-largest economy, witnessing gross domestic most advanced economies globally, ranked first in the product (GDP) growth rates of a low 6.6% in 2018, its slowest Bloomberg Innovation Index. As a leading supplier of pace in 28 years. Political risk between USA and China, the electronics, automotives and semiconductors to global ongoing revision of the USA-Korea trade agreement, and markets, Korea benefits from a highly-educated and hard- many non-trade barriers also pose challenges to Korea. working population that is supported by modern, high-tech Against this external backdrop, Korea faces a number of infrastructure, including the commercialisation of 5G in internal challenges, such as a gap between the rich and the March 2019 (country-wide, and the first such roll-out in the poor, social welfare issues, and environmental degradation. world). Korea is also a free-trade leader, which the WEF4 ranks Low fertility is another serious challenge to the Korean fifteenth in global competitiveness overall, more specifically: economy; combined with an ageing society. These social first in ICT adoption (e.g. fibre internet subscriptions); first in challenges may slow down economic growth, lower tax macroeconomic stability (e.g. inflation); sixth in infrastructure revenue, and also increase pressure on public sector services. (e.g. electrification); and eighth in innovation capability (e.g. In response to these challenges, Korea intends to diversify patents, R&D spend). Notably, Korea ranks first in the world for its national portfolio by extending into ICT-added-value research and development (R&D) investment as a percentage technologies and services via Smart Cities demonstrators. of gross domestic product (GDP) with an equivalent of 4.55%.5 Through the Smart Cities demonstrators, Korea hopes to Despite these clear strengths, Korea faces a number of achieve continued economic and social benefit through challenges to sustain its economic growth and social the development of its small and medium enterprise
5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 KOR UK EU28 Source: OECD Science, Technology and R&D Statistics: Main Science and Technology Indicators
4 https://www.weforum.org/reports/the-global-competitveness-report-2018. 5 OECD (2017). Available at: https://data.oecd.org/rd/gross-domestic-spending-on-r-d.htm.
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(SMEs) capability, further development of its technology infrastructure, the creation of regulatory alignment, and strengthened international collaboration. This overarching policy initiative may be summarised as Korea’s response to the Fourth Industrial Revolution (4IR)6 and is discussed in more detail below.
2.2 Policy: The Fourth Industrial Revolution (4IR) The Fourth Industrial Revolution (4IR) refers to the process of innovating various industries (including manufacturing, medicine, agriculture and ICT) using intelligent information technologies such as the Internet of Things (IoT), big data, Meeting with the PCFIR cloud computing, 5G, mobile, and artificial intelligence (AI) to solve complex urban problems in order to enhance the • fosters ecosystems for new industries (e.g. Special efficiency of city management and to improve the quality- Committee on Smart City, Special Committee on of-life for citizens. Key drivers for the 4IR in Korea include Healthcare). an excellent ICT infrastructure, with world-class network The PCFIR benefits from the work of successive governments coverage, connection speed, and data costs. In addition, the which have committed resources to ICT and 4IR. For example, minimum wage in Korea increased by 62.5% between 2014 Korea leads the world in internet speeds and smartphone and 2019, and with working hours capped, there has been penetration and is currently leading the global race to significant income-led growth. Another key driver for the commercialise 5G, as detailed below. 4IR in Korea is that public welfare has a particular focus on e-government, Smart Cities, public safety, digital health and The PCFIR’s reach across the innovation ecosystem of Korea pollution control. represents a significant channel to key stakeholders for potential UK-Korea collaboration. Additional drivers for 4IR include cyber threats from North Korea, domestic actors and industrial espionage. In addition, 2.4 5G: Global Leader China is rapidly catching up with Korea in many of its core Korea launched the first 5G deployment worldwide when industries and 4IR technologies. nearly £2.6 billion was spent by three operators in 5G band auctions. The three operators launched their 5G network 2.3 Infrastructure: Fourth Industrial Revolution (4IR) simultaneously on 4 April 2019. Initially, there were only a few A key factor driving the Korean government’s 4IR agenda industrial clients (low-latency video monitoring for supply is the Presidential Committee on the Fourth Industrial chain), which was followed by a fast ramp-up in the consumer Revolution (PCFIR). The PCFIR deliberates upon and market, a key driving factor of this being the roll-out of 5G for coordinates important policy matters pertaining to the buildings. As of early May 2019, there was a large customer development and acquisition of new science and technology, pool of 260,000 customers and 54,000 base stations installed. including artificial intelligence and data technology, as The 5G network has difficulty keeping up with demand. well as new industries and services necessary for Korean society’s adaptation to the 4IR. The committee’s legal basis Korean manufacturers are advanced and cover the entire can be found in the Presidential Decree on the Creation and ecosystem. Samsung has one of the 5G base stations. LG and Management of the PCFIR, promulgated and effective as of 22 Samsung have a few 5G-ready handsets, with more models August 2017. The PCFIR: to be launched in the near future. Most have a hefty price tag attached to them. • deliberates upon and coordinates policy measures submitted by various ministries and the committee There are several areas of focus for 5G use cases, including members; Ultra HD content, AR and VR content, Smart Cities, Smart Homes, Smart Factories, and Smart Offices. As many of • organises public campaigns related to the 4IR and these use cases can be run on the Long-Term Evolution encourages public participation; (LTE) network, operators are struggling to find 5G specific • prepares the groundwork for regulatory and institutional applications and are looking at new ways to recoup the reforms in support of public-private partnerships; and significant investments on the 5G network.
6 https://www.s-ge.com/en/article/news/20174-mem-korea-industry-40-update.
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Generating Momentum
Building on existing UK-Korea collaboration in 5G In 2018, the Korean 5G Forum (a non-profit organisation established in May 2013 with the aim of globally leading and promoting 5G towards the year 2020) and the UK 5G Innovation Network (which was founded in January 2018 and aims to boost the development of the UK’s 5G ecosystem, facilitating the engagement and coordination of organisations and businesses working on 5G activities across the UK) signed a MoU to regulate how they would cooperate and collaborate with one another to achieve their objectives.
The MoU is valid for two years and enables both parties to cooperate, exchange ideas and collaborate in the following areas:
• information exchange regarding 5G mobile communication technology; • analysis of technology trends; • discussion of global standardisation trends; • promotion of 5G ecosystem growth; and • other areas as agreed between the two organisations regarding next-generation mobile communications.
The scope/objectives of the 5G Forum are to: develop vision and service; study spectrum aspects; identify potential technologies; collaborate for global harmonisation, and act as a bridge between industries and government.
In addition, the UK 5G Innovation Network will enhance links between ongoing research and development and other activities being undertaken by organisations across telecoms and other sectors, as well as across the UK Government’s 5G Testbeds and Trials Programme. The Network will also provide information on UK capabilities, and help to encourage increased inward investment.
One of the concrete activities that emerged from the signature of the MoU was the £2.4 million UK/South Korea 5G Challenge7. The competition that recently closed had the aim of developing new and novel applications and services that can be ready for 5G and enable collaboration between UK and South Korean organisations.
The successful applicants will test their solutions in a subway environment, initially across the Seoul subway system, but potentially extendable to other forms of transport, and travelling at greater speeds.
The competition is part of the UK’s 5G Testbed & Trials (5GTT) Programme, which aims to maximise the opportunities for UK businesses, especially SMEs, to develop new 5G applications and services for both domestic and global markets. The competition was funded by the UK’s Department for Culture, Media and Sport (DCMS) and the Korean Electronics and Telecommunications Research Institute (ETRI).8
7 https://www.gov.uk/government/news/the-24-million-uk-south-korean-5g-challenge. 8 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/797954/Final_copy_-_Infotainment_Services_for_Transport_Environments_ Competition_Guidance__1_.pdf.
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2.5 IoT Networks: Global Leader exceeding 100,000 for the first time, the government is set Although Korea is the first 5G deployment worldwide, it also to infuse an additional KRW12 trillion (US$12 billion) into has multiple IoT-specific networks catering for Smart Homes the ecosystem by 2022 in order to push venture investment and Smart Cities applications. These include: in the country for the second time post the 2000s. Of this investment, a scale-up fund will raise the amount for new • Sigfox: Deployment ongoing, in-country partner, suited for venture investment to KRW5 trillion (US$5 billion). In addition, small data. an “M&A-only fund” worth KRW1 trillion will be established by • LoRa: Deployed in 2016 by SKT, suited for small data. 2021 to encourage companies and investors to participate in recovery markets.9 • LTE-M: Deployed in 2016 by all three operators, suited for data, or voice and video. Aligned to the above investment, the Korean government has recently introduced a regulatory “sandbox” to enable • NB-IoT: Deployed in 2017 by LG U+ and KT, suited for small regulations to be developed, allowing the Smart Cities data. policy objectives to be realised. The government also seeks international collaboration and knowledge transfer 2.6 SME-Enterprise and Innovation opportunities, as evidenced by an increasing number of As previously mentioned, to address current and emerging bilateral MoUs related to Smart Cities that have been agreed socioeconomic challenges in Korea, the government is with countries such as The Netherlands and Germany. encouraging the growth of SMEs. In order to achieve this goal, the government established the Ministry for SMEs and During the mission visit, officials from the Korea Agency Start-ups (MSS). This shift to SMEs is challenging due in part for Infrastructure Technology Advancement (KAIA) and to the cultural and economic dominance of chaebols, which representatives of the PCFIR expressed strong interest in are large industrial conglomerates that are run and controlled Korea-UK collaboration, including agreeing to form a UK- by an owner or family in Korea. Given this, the chaebols have Korea MoU related to Smart Cities. The UK strengths that begun to recognise the importance of a vibrant SME sector are of particular interest to Korea - and which could form an within the Korea innovation ecosystem. For example, Hyundai initial basis for future collaboration and a MoU - include UK provides an accelerator and venture fund to provide a flow capability and expertise in AI, Blockchain, IoT, Standards, and of innovative ideas, technologies and SMEs to support their design-led innovation for SME-led growth. global growth. Complementing this, Intralink10 has identified the following With venture capital surpassing KRW3 trillion (US$3 opportunities for growth: billion) last year and the number of new venture companies
Autonomous vehicles Driving platforms, machine vision, AI.
Hydrogen for energy Charging stations and infrastructure to support hydrogen vehicles.
Energy savings technologies Energy efficiency is critical to Busan and Sejong projects.
Energy management platforms Data analytics to support intelligent power distribution.
Drones Korea’s UAV hardware/software capabilities are weak due to regulatory restrictions.
Blockchain Used for EMR, but also logistics such as smart ports.
Sensors Sensors for IoT applications in industrial, waste management and energy settings.
9 https://koreatechtoday.com/korean-government-to-create-12-trillion-won-of-a-scale-up-fund-by-2022-for-a-second-venture-boom/ 10 Intralink (2019): Smart Cities South Korea Market Intelligence Report June 2019. United Kingdom: Department for International Trade.
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3. Korea Smart Cities
3.1 National Smart Cities Strategy R&D Validation Projects Smart Cities are a key part of the Korean government’s R&D Validation Projects aim to advance a Use Case Model industrial policy. The Smart City projects are designed to in Daegu, and a Living Lab Model in Siheung. Both will achieve twin objectives: 1) improvements in the lives of be connected to an Open Source Urban Data Hub which Koreans; and 2) economic growth through the development includes the collection, storage and sharing of data across an and commercialisation of emerging Fourth Industrial integrated city-wide platform, as well as its use in component Revolution technologies. Technology deployed in Smart City services. The cities will serve as testbeds for the Korean Smart projects has the potential to be deployed nationwide, as well City model. The two projects have a combined budget of as in markets outside of Korea. £75 million and will run for five years through to the end of 2022. Research in Daegu will target intelligent mobility, crime The Smart City policy is coordinated by PCFIR and the prevention and resilience in response to natural and human- Ministry of Land, Infrastructure and Transport (MOLIT). made disasters. Projects in Siheung will concentrate on the Significant political support has been given to national Smart environment, welfare and energy. City projects, and the MOLIT is motivated to finish the flagship projects before the end of President Moon Jae-in’s term in Urban Regeneration Projects 2022. Urban Regeneration Projects will take place nationwide, including in Daejeon, Gimhae and Bucheon. These projects 3.1.1 Projects and Timelines will aim to resolve the problems of older urban areas The Korea Smart Cities initiative is comprised of three types of through the use of data connectivity, rather than large-scale national projects: 1) Flagship Pilot Projects; 2) R&D Validation redevelopment. The projects are small-scale and thematic Projects, and 3) Urban Regeneration Projects. in nature. In February 2019, MOLIT announced the cities of Flagship Pilot Projects Daejeon, Gimhae, and Bucheon as the recipients of a total Flagship Pilot Projects aim to demonstrate the full capability £7.5 million in funding. Daejeon’s theme will be a “Re-New of Korea’s Smart City capability. They are designed to meet Science Town”, that aims to showcase general scientific R&D as the needs of citizens and enable the growth of high-value many corporate and government research centres are located start-ups and scaleups through demand-led innovation and in the city. Bucheon will focus on using big data analytics to enterprise. Busan and Sejong City were selected in early 2018 monitor and reduce air pollution throughout the city, while from a total of 39 candidate cities by the PCFIR. Greenfield Gimhae will invest in AR and VR attractions for its historical sites in both cities, approximately 2-3 square kilometres, were sites. chosen due to the ease of development in terms of cost and 3.1.2 Key Services of National Pilot Projects time. President Moon Jae-in’s government has announced A recent report commissioned by the Department for two Smart City pilot projects in Busan and Sejong City worth International Trade (DIT)11 identified that the following key a combined £3 billion, of which £1.8 billion is to be provided services of the national pilot projects are aligned to sectors by national government funding, which was approved in where there is significant potential for Korea to meet the late 2018. Construction is due to begin in late 2019 with the needs of its citizens: first residents due to move in by late 2021. Key services in these pilot projects will centre on mobility, energy, education, healthcare and infrastructure.
Mobility Autonomous vehicles, last-mile solutions, AI traffic control.
Energy Smart grid management, solar generation, hydrothermal energy.
Healthcare Blockchain EMR, drone first responders, caretaker robots, AI diagnostics, wearables for first responders.
Education Edutech platforms, alternative assessment methods.
Infrastructure Cloud-based logistics, smart factories, automated water meters.
11 Intralink (2019); Smart Cities South Korea Market Intelligence Report June, 2019. United Kingdom: Department for International Trade.
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These services have also been recognised as holding many challenges, including that of an ageing population. With significant potential to develop wealth-creating innovation several high-quality universities in the area, there is good and enterprise. potential for Busan to attract and retain talent to deliver on three key areas: 3.1.3 Regulations and Vendor Selection The Korean government has created regulatory sandboxes Smart Water City in both Busan and Sejong. These regulatory sandboxes, Busan is known for water, which is a key topic for smart city approved in September 2018, lift regulations related to development. The city has excellent international seaports, Smart City development in areas such as data collection, and one of the longest rivers in Korea flows through the city. autonomous vehicles, drones, and land use. If the pilot For many years the water has been contaminated due to the projects that are rolled out under these sandboxes are illegal disposal of chemical waste. President Moon Jae-in’s successful, the regulations may be revised nationwide to spur Administration has put K-Water in charge of cleaning the river the development of Smart City projects by other regional and pollution problem. K-Water will utilise advanced water-related municipal governments. technologies to realise Smart Water City in Busan and resolve the river pollution challenges. Vendor selection will likely use a special purpose entity or public-private partnerships, a final decision is expected in Smart Tech City mid-2019. Foreign companies can apply to participate in Busan has struggled to attract and retain graduates from government-led projects through Korea’s Public Procurement the local universities, who often choose to find jobs in the Service, but there are cultural, language, and business Seoul area. In response, Busan will be positioned as a vibrant environment barriers. Foreign companies are, therefore, innovation ecosystem - a place where start-ups and SMEs can strongly advised to partner with companies based in Korea. innovate to create and then scale technology-led innovations This also is compliant with the government’s preference to to serve the needs of Busan and other Smart Cities globally. engage with local businesses, as such foreign companies need to demonstrate added-value. International Cooperation In Busan Smart City The Korean government intends to open its market to foreign 3.2 Case Studies entities, which will be supported by its global living lab and The Fourth Industrial Revolution aims to be a people- international exchanges. centred initiative that will improve people’s quality-of-life by During the mission, delegates conducted a site visit and met resolving chronic social problems and creating high-quality with officials from the Busan IT Industry and Promotion innovations and enterprises. The industrial innovation will Agency (BIPA). With a clear focus on job creation in Busan, span healthcare, manufacturing, vehicles, energy, finance and BIPA aims to enable a productive start-up ecosystem by logistics, and agriculture and fisheries. These innovations will offering customised IT/CT training, a one-stop start-up aim to resolve social problems that face cities, transportation, support service, and support for self-sustainable networks. welfare environment, safety and defence. To support rapid development and diffusion of technological innovations, the Within the year, the Busan Smart Cities programme aims to Korean government has established a programme of social- start supporting joint ventures. With a total development consensus “hackathons” to inform regulatory and institutional budget of approximately £1.2 billion, a significant share of this reform. is earmarked for Korean-foreign joint ventures to demonstrate tech. The criteria for selection has not yet been decided, The PCFIR announced a portfolio of innovation initiatives to but the foreign companies would need to have Korean deliver this vision. Below, five case studies are considered in relationships, including the ability and desire to work together. detail: two new national testbeds (Busan and Sejong); one In addition, the programme might ask the other country’s existing smart city initiative (Seoul); and an R&D validation government to provide joint funding. (Daegu and Siheung). Driving this ambition for innovation and collaboration is the 3.2.1 New Smart City: Busan creation of a Busan Smart City innovation ecosystem, which K- Water (Korea Water Resources Corporation) is the Smart aims to foster new industries and develop into an eco-friendly City developer of the Busan Smart City, which is near the future waterfront city. Construction will begin at the end of Gimhae International Airport in a coastal area in the south 2019, with the ambition for citizens to move into the new of Korea. The masterplan for this project is led by Mr Jaewon Smart City and experience it first-hand by the end of 2021. Peter Chun, the National Smart City Master Planner from the PCFIR. As the second-largest city in Korea, the city faces
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Smart City Busan: Vision
“In a Smart City, technologies come alive for people.
Behind the facade of the facilities visible are the key technologies of the Fourth Industrial Revolution connected like neural networks through every nook and cranny. They will make our lives safer and more convenient.
Those services that have been available separately thus far, including transport, public security, disaster prevention, administration, healthcare and day care, will be linked with each other in a well-organised and efficient manner.
If you live in Busan’s Smart City in 2022, you can save up to 124 hours a year: 60 hours spent on daily commutes, 20 hours on administrative work, 5 hours waiting at hospitals and so on. An integrated safety management system utilising Fourth Industrial Revolution technologies will make it possible to notify the general public of information about such disasters as earthquake and fire immediately and to dispatch fire trucks within 5 minutes. The urban crime rate can be reduced by 25% and traffic accidents by 50%.
Everyone can benefit from tailor-made healthcare programmes with a real-time health monitoring system. They will also be able to receive robot-assisted daily support with the adoption of home artificial intelligence assistants, autonomous delivery robots and rehabilitation robots.”
- Remarks by President Moon Jae-in at Busan Smart City Innovative Strategy Presentation. 13 Feb 2019.
For UK start-ups, Busan could serve as a testbed for emptively (prevention) throughout the medical network innovative Smart Cities technologies, which they could then environment. use as a pathfinder to enter and scale-up in the wider Asian • Education: The city increases critical and creative thinking market. and provides education for start-up and jobs. • Governance: Citizens solve problems in the city by 3.2.2 New Smart City: Sejong themselves and test basic income through cryptocurrency. This national pilot project aims to become the leading • Culture and shopping: Through customised prediction Smart City in the world. As a greenfield initiative, Sejong is services, the city provides different cultural experiences and guided by a philosophy to create a sustainable platform city convenient shopping environments. that increases the happiness of citizens and offers creative • Jobs: Through cooperation and co-existence among various opportunities. It will directly address urban problems such parties, the city forms a sustainable economic ecosystem. as pollution, fast energy consumption, serious congestion, • Energy and environment: Renewable energy and E-mobility and natural ecosystem destruction. In doing so, the city is demonstrate a participating and climate-neutral city being designed around values that promote lifestyle, work-life model. balance, and human-centric and eco-friendly living. • Urban spaces: The city sources flexibility of spatial use, tests job-housing proximity and aims to create an eco- To deliver the Sejong Smart City vision, data and services will friendly environment. flow between seven Innovation Factors, each enabled by an integrated blockchain architecture: The technical challenges required to deliver the vision are considerable; correspondingly, there are also significant • Mobility: The city maintains the economic expenditure opportunities for UK-Korea collaboration and synergy. and comfort, with the aim to gradually decrease the total number of cars to one-third. During the mission, Sejong officials demonstrated that they • Healthcare: The city acts quickly (emergency) and pre- are open to a dialogue on determining what the offer should
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Meeting in Sejong
be for companies validating and demonstrating their services Seoul has won the first place seven years in a row in a “Global in their testbed, apart from the regulatory sandbox. In e-Government Survey”, sponsored by the United Nations. The addition, the Sejong Smart City project team is actively trying Seoul Metropolitan Government (SMG) provides citizens with to identify UK start-ups interested in demonstrating their CCTV for safety, public WiFi for network connectivity and products and services in Sejong’s testbed. However, the offer various services based on the ICT infrastructure. The SMG for the companies is yet to be defined. seeks to solve urban problems by encouraging citizens to express their opinions and participate in public administration With a clear aim to crystallise available opportunities, the SIN, more actively through channels such as mVoting, 120 Call KTN, and the European Enterprise Network (EEN) are already Centre, and Seoul Smart Complaint Report. working to support the selection of companies and raise awareness of the capabilities of UK Smart Cities start-ups to Since 2013, the SMG has supported the private sector in the Smart Cities team. developing new services that citizens want by disclosing 4,500 public datasets in machine-readable formats. Since Areas where the UK is best positioned to add value include 2015, Seoul has embarked on a plan to become the “Global technology standards; AI; user-centred design; and city-based Digital Capital” by 2020. Particular effort has been directed at start-up acceleration. supporting a number of citizen-enabling initiatives, including the creation of “Social Seoul City”, which seeks to achieve 3.2.3 Existing Smart City: Seoul 50% of digital projects being led by citizens. The SMG is also Seoul has been the Korean capital for 600 years, and is the proactive in supporting the digital economy through its centre for politics, culture and the economy. Just 60 years engagement with digital industries. ago, Seoul was in the ruins of war and one of the poorest cities globally. Since this time, Seoul has risen with rapid The Seoul Smart City initiative is directly controlled and led urbanisation to become a world-class metropolitan city with by the SMG; and, to a large extent, successfully so. There does a population of 10 million. The city has become a sustainable not appear to be direct and formal engagement with the Smart City with the ability to solve diverse urban problems new Smart Cities projects of Busan and Sejong, suggesting a such as housing, water and sewage, rubbish collection, potential lost opportunity to share knowledge and learning transportation and welfare. within the Korean ecosystem.
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Seoul: Smart City leadership
With a population of around 10 million citizens, and another 15 million people living in its wider reaches, Seoul is a global city with challenges related to pollution, traffic congestion and the limited availability of affordable housing. Mayor Park Won-soon was elected to office in 2011 and started a programme of engagement of citizens. For example, citizens are invited to debate current and major policy issues and to participate in problem-solving for issues faced by their community, both online and offline in “field offices” visited by the mayor, where he can discuss issues directly.
The city also encourages the engagement of its citizens by holding innovation competitions to find smart solutions to Seoul’s problems and has provided a collaborative public space in the City Hall for events and activities such as discussions and lectures, as well as exhibitions and community recreation programmes. In mid-2016, the Seoul Digital Foundation was established with the goal of driving and facilitating digital innovation in the city. It is responsible for fostering a digital economy, researching and consulting on information and communication technologies and their potential applications to solve Seoul’s problems.
In 2019, the City of Seoul plans to install 50,000 IoT smart sensors throughout the capital city so that by 2022 they are able to collect information on fine dust, traffic and other things related to citizens’ lives. In addition, chatbots will be added to its 120 Dasan Call Centre service, a civil complaints hotline. The project involves spending KRW1.4 trillion (£954 million) over the next four years to turn Seoul into a “capital of big data”.12
With a clear focus on achieving its Global Digital Capital goals, and Business intelligence. Connecting the two cities will be an areas where the UK may provide significant synergy and Open Source Urban Data Hub. collaboration with the City of Seoul include UK knowledge transfer in user-centred design and city-based start-up This programme was designed and launched to develop acceleration. standardised open data hub architecture, which will be the common basis to apply transparency and sharing of 3.2.4 R&D Validation in Daegu and Siheung administrative services, and to facilitate growth in the digital The National Strategic Smart City Programme includes a economy. Smart City model development project. The City of Daegu will deploy a Use Case Model for service enhancement; and, the Development of the Smart City Model and Base technology City of Siheung will deploy a Living Lab Model for innovation includes:
Data hub Design of the cloud-based open data hub architecture model to collect, process and store data with standard data models and interfaces.
Massive IoT standards Development of intelligent IoT devices, infrastructure enhancement, network establishment and control technology for massive IoT data processing (e.g. transportation, environment, energy, safety).
Digital twin Using virtual platform technology development for rendering and real-time establishment and control technology for massive IoT data processing (e.g. transportation, environment, energy, safety).
Data governance Developing a model to manage Smart City R&D project.
12 https://hub.beesmart.city/city-portraits/smart-city-seoul-part-1-the-power-of-citizen-participation http://koreajoongangdaily.joins.com/news/article/article.aspx?aid=3060520
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Meeting with KAIA
During the mission, discussions regarding the data hub, entrepreneurial risk-taking and 88th globally for employee digital twin and data governance suggested that the empowerment. A more vibrant innovation ecosystem would Korean approach was still relatively immature. Some of the allow Korea to more effectively translate their research efforts information management work being undertaken in support into economic growth and increase long-term resilience. of the Digital Framework Task Group in the UK, for example, could offer considerable benefits to the Koreans and also The lack of direct user-engagement limits the potential enable the UK to test its concepts in a receptive market. for strong product-market fit and the realisation of the Aligned to this, the UK is significantly engaged with the wider government’s policy to support innovation and enterprise. debate about data ethics and trust and the use of citizen’s An approach around place-making and full user engagement data. Each area represents significant scope for UK-Korea during each stage of product and service development is collaboration. not obvious in the current plans. User-centred design and participatory development would go some way to de-risking 3.3 Barriers to Implementation issues around public acceptance and trust of Smart City In developing its Smart Cities projects, the Korean solutions, especially as Korea is also looking to enter into government has identified a number of areas that it will target European markets. to create social benefits (e.g. mobility, healthcare, energy). The Korean government intends to share data arising from In addition, the relatively immature approach to data these projects to enable start-ups and scaleups to innovate, modelling, coupled with the apparent silo approach, will creating technology-led innovations for social benefit and significantly hamper cross-domain information sharing economic gain. Yet, their silo approach to project planning and and thus reduce the benefits that could accrue from the implementation limits interaction and diversity, resulting in development of an integrated data model. The UK’s work on sub-optimal innovation and enterprise development. high-quality data modelling could facilitate the development of an integrated data model that helps the Koreans to address For success in the Fourth Industrial Revolution (4IR), all these constraints. If this were coupled with the development economies need to embrace the opportunities offered of relevant standards, the benefits would be shared by the UK by innovation. Although Korea excels on tangible drivers and South Korea. of innovation such as ICT adoption, where it ranks first globally, it very clearly struggles on the less tangible drivers With a focus on user-centred development and data of innovation. Globally, in critical thinking, Korea is ranked modelling, the UK is particularly strong in developing 90th, for interaction and diversity it’s ranked 80th, and entrepreneurial culture enabled by interaction and diversity. for entrepreneurial and corporate cultures, it’s ranked This UK expertise represents a significant opportunity for 50th. This lag could be caused by a tendency toward synergy and collaboration to overcome some of the key uncertainty avoidance; indeed, Korea ranks 77th globally for barriers to implementation.
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4. Synergies
4.1 Collaboration Synergy are similar to those experienced in UK cities, such as how As noted above, Korean industry generally seeks to innovate best to provide social care for older people. To achieve this, via the development of the incubation model, while the enabling technologies such as mobiles, IoT, AI, 5G and big data Korean government generally seeks to develop innovation and are used to create technology-led services. enterprise through policies that enable the growth of high- value start-ups and scaleups. Both industry and government 4.1.1 Industrial Innovation and Enterprise Korean companies such as Hyundai Motors are developing are keen to forge links with UK expertise. a global accelerator model and venture arms to support It is clear that in some areas, Korea is in a particularly strong innovation and rapid commercial distribution, with reach to position with regards to the take-up of advanced technologies such cities as Berlin, Tel Aviv, and San Francisco. UK start-ups and 5G deployment. Given this, the mission observed a are encouraged to participate in such activities. disconnect between the policy aim to be people-centred (e.g. user-centred design, co-design) and the use cases, which 4.1.2 Innovation Ecosystems Enabled by its new Smart Cities projects, Korea seeks to were mostly tech-led. The UK has particular strengths to create vibrant innovation ecosystems to support innovation offer which could be used to support colleagues in Korea and enterprise. The UK has extensive experience in helping to deliver their policy aim to be people-centred, including start-ups and scaleups to flourish, and this experience user-centred development, AI, standards, and data modelling. may be shared with Korea counterparts to create synergy Bringing together such capacity and capability provides a and collaboration. To illustrate, the total venture capital unique opportunity for collaboration and synergy. In doing so, investment in UK technology in 2018 topped £6 billion, more city demonstrators in both Korea and the UK could serve as than any other European country. The recent growth rate testbeds and demonstrators for home and overseas markets, of 56% for London tech scaleups makes the cluster first in helping to accelerate improvements in quality of services for the world for scaleup growth. With £5 billion of scale-up all citizens. investment, the UK ranks fourth in the world, after the US, Both Korea and the UK have Smart Cities demonstrators China and India. running. Many of the social challenges faced in Korean cities
Collaboration Models
There are a number of existing collaboration models between the UK and Korea which can be leveraged to accelerate the development of opportunities. These models include:
• Korea is a Eureka Country, which is part of the European Commission’s H2020 programme. • MoU between Korea 5G Forum and the UK 5G Innovation Network. • MoU with Korea and the UK governments in 2018 to increase bilateral trade and investment. • The UK has a very active Science and Innovation Network team in South Korea that has Smart Cities as one of its priority areas. Their relations and effective engagement is ideally positioned to be leveraged and expanded to support collaborations in Smart Cities. • DIT South Korea has Smart Cities as a priority area. It has a series of activities lined up such as a Trade Mission and UK Pavilion at the World Smart City Expo, and an upcoming visit of SK Telecoms to the UK. • The British Standards Institute has an office in South Korea.
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Korean Collaborations: Engagement by other countries
Sweden • A MoU between KAIA and Viable Cities has been drafted, and the document is under review. The collaboration will focus on Smart City living labs and testbeds and international standardisation. The parties are holding a joint workshop during the Barcelona Smart City Expo in November 2019.
European Innovation Partnership • KAIA signed a MoU with the European Innovation Partnership on Smart Cities and Communities which was established by the European Commission in November 2018. • The partnership is on establishing the foundations for international collaboration, the opening of innovative policy lab, networking between cities, joint R&D and tech demonstration.
Portugal • KAIA signed a MoU with Braga City of Portugal in November 2018. • The partnership is focused on the development of Smart City solutions, smart water grid, city planning, engineering, building, technology, environment and energy. They are working on the development of a joint R&D programme and researchers exchange programme.
The Netherlands • In July 2019, the Ministry of the Interior and Kingdom Relations and the Korean Ministry of Land, Infrastructure and Transport (MOLIT) signed a Smart City MoU. This MoU will increase the chances of sustainable cooperation and business.
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5. Potential Areas for Collaboration
A recent report commissioned by DIT South Korea13 has demonstrated that there are concrete commercial opportunities for UK businesses in the Korean Smart Cities environment, as detailed below:
5.1 Sector Opportunities An analysis of the Fourth Industrial Revolution (4IR) policy by Intralink reported the following sector opportunities:
Transport Autonomous vehicles, driving platforms, machine vision, AI.
Drones Korea’s UAV hardware and software capabilities are weak due to regulatory restrictions.
Sensors Specialised sensors for IoT applications in industrial, waste management and energy settings.
AI Healthcare (e.g. drug discovery, medical care).
Blockchain Healthcare (e.g. Electronic Medical Records). Logistics (e.g. smart ports).
In addition to the above, one sector where the Korean 4IR programme and KAIA could fortuitously develop collaborations is in the area of energy and renewable energy strategies, given that the country’s energy mix for low or zero-carbon generation stands at around 4% and the rapid pace of envisaged city creation in Korea. Potential energy sector opportunities include:
Hydrogen for energy Charging stations and infrastructure to support hydrogen vehicles.
Energy-saving technologies Energy efficiency will be a key component across the Busan and Sejong projects.
Energy-management platforms Data analytics to support intelligent power distribution.
Within the sector of renewable energy strategies, shared projects could include:
• Solar farms in surrounding areas of planned new developments. • Microgrid, embedded generation and energy storage combinations. • Better performing building technologies in terms of heat and energy optimisation. • Out of city wind and solar systems to reinforce the green energy mix on the grid. One of the developments was in a coastal zone providing a clear opportunity for offshore renewable solutions. • Heat capture and utilisation. • Domestic energy management and balancing utilising EV battery storage.
13 Intralink (2019); Smart Cities South Korea Market Intelligence Report June, 2019. United Kingdom: Department for International Trade.
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5.2 City-Based Innovation Ecosystems Over several decades, Korea’s five largest companies have been the leading innovation and enterprise solution providers for the nation. However, with ever-increasing global competition, there is growing recognition that innovation and enterprise creation will be an essential driving force for future prosperity. The powerful companies are looking to innovate via the incubation model; meanwhile, the Korean government focuses on the development of city-based innovation ecosystems as a driving force for enterprise creation.
Notably, Korea’s Smart Cities projects are advancing independently, with little evidence of a formal policy that brings together a shared vision. This lack of collaboration, if it continues, will likely reduce opportunities for synergy, innovation and enterprise. Notwithstanding this risk, the 4IR encourages international collaboration, especially in the area of knowledge transfer and investment into Korea. Within this policy context, the UK has extensive experience enabling the growth of start-ups and scale-up by enabling inclusive and diverse city-based innovation ecosystems. In cities across the UK, SMEs, corporates, investors, academics, lawyers, and others come together in formal and informal ways to create and grow enterprises. This unique UK experience may be shared with colleagues in Korea, providing mutual benefit.
As Korea advances to the next stage of development, nearly all facets of standards-setting for the above sectors appeared to be in an embryonic state. Recognising UK expertise in standards-setting, KAIA expressed strong interest in UK-Korea co-development of international standards. In particular, there is a significant UK-Korean collaborative opportunity to lead on the development of internationally-recognised Smart City Data Standards for 4IR, servicing innovation and enterprise creation. Joint UK-Korea development of new British Standards Institute standards positioned at the confluence of IoT, 5G, AI, and big data - and which ensure regulatory alignment, deliver enhanced cybersecurity, and generate desired user benefits - is an unmissable global market-shaping opportunity.
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